The Cabinet on Wednesday decided to double the wage ceiling
for calculating bonus to Rs 7,000 per month for factory workers and
establishments with 20 or more workers.
“The Payment of Bonus (Amendment) Bill, 2015 to enhance the
monthly bonus calculation ceiling to Rs 7,000 per month from existing Rs. 3,500
was approved by Union Cabinet here,” a source said after the Cabinet meeting.
The amendment bill will be made effective from April 1,
2015. Now the bill will be tabled in Parliament for approval.
The bill also seeks to enhance the eligibility limit for
payment of bonus from the salary or wage of an employee from Rs. 10,000 per
month to Rs. 21,000.
The Payment of Bonus Act 1965 is applicable to every factory
and other establishment in which 20 or more persons are employed on any day
during an accounting year.
The bill also provides for a new proviso in Section 12 which
empowers the central government to vary the basis of computing bonus.
At present, under Section 12, where the salary or wage of an
employee exceeds Rs. 3,500 per month, the minimum or maximum bonus payable to
employees are calculated as if his salary or wage were Rs. 3,500 per month.
The last amendment to both the eligibility limit and the
calculation ceilings under the said Act was carried out in 2007 and was made
effective from April 1, 2006.
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